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Can Solana (SOL) Drop Lower?

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Can Solana (SOL) Drop Lower?

Without a doubt, the beginning of 2022 has been volatile for cryptocurrencies. It seems as if all tokens are moving several percentage points daily, and no one knows if there is an end in sight. One such token caught in this volatility is Solana, a blockchain that focuses on decentralized finance (DeFi) applications through low costs and high speeds. While Solana has fallen significantly in the past year, Benzinga takes a look at what the future may hold for the project. 

Can Solana (SOL) Drop Lower Than $20?

One price point that many are eyeing for Solana is $20. The token is currently trading around $30, so this is a considerable drop. However, when you examine current price trends, this price may not be out of the question.

Towards the end of 2021, SOL hit an all-time high of over $250. Since then, it has fallen to its current price levels. 

A couple of events may determine if SOL can drop lower than $20. The first is the future of the crypto markets. If they continue to fall, then SOL could get dragged along and drop below $20. Conversely, the markets could rally, and the price could begin moving away from $20. 

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Another event that plays importance in the future of Solana is the ETH Merge. The merge could bring back demand for DeFi. This move could either work in favor for SOL by bringing back users and demand for SOL or attract users to ETH and detract from the need for Solana. 

Either way, the future price of SOL is largely dependent on overall market conditions as well as future news from its competitors. 

Why is Solana (SOL) Going Down?

SOL’s price drops could be attributed to multiple happenings in the crypto space. First, the overall crypto markets have suffered. Solana could be caught up in this and gone down with most other cryptocurrencies. 

Additionally, the demand for DeFi has dropped considerably in recent months. Since Solana is an answer to slow transactions speeds from high demand, it has lost a significant amount of activity on the chain. With less activity, there is less demand for the SOL token, thus bringing the price down. 

How to Short Solana (SOL)

If you are bearish on Solana, then you may have considered shorting the token. Fortunately, there are multiple ways to do so. 

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The first option is the most straightforward and is through the crypto exchange ByBit. This exchange offers inverse perpetual derivative contracts, which are a way to short a token using the token itself as collateral. 

The other way to short Solana is a more traditional way of shorting. This process involves borrowing the token and instantly selling it. Then if the price falls, you can buy back the tokens and return them to the lender for a profit. This is a much risker form of shorting. 

Can Solana (SOL) Still hit $100 in 2022?

Another major price point for Solana is $100. While this is a far cry from its previous highs of over $250, it is still over three times the current price. 

For Solana to hit $100, the markets would have to rally pretty heavily. The last time the price was at $100 was in April 2022. The markets have fallen considerably since then, so a turnaround would require a lot of support. 

Additionally, institutional investors have shown a strong preference for SOL in the past year. If institutional investment floods the crypto scene, then SOL could see price hikes much faster than other tokens. 

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Where to Buy Solana (SOL)

Solana has grown in popularity since its release in 2020 and has made its way up to number nine out of all cryptocurrencies in terms of market cap. Because of this, the token is available on a variety of crypto trading platforms.

Among the best platforms that the token is offered on include Coinbase Global Inc. (NASDAQ: COIN), Robinhood Markets Inc. (NASDAQ: HOOD), FTX and Gemini. These platforms are well known for their low fees, ease of use and security. 

Will Solana (SOL) Keep Crashing?

Solana has had a tough run in 2022, and no one knows where the price may go. However, it is possible to take a look at factors that may impact Solana’s price and come up with inferences. 

If you are interested in trying to predict where Solana may go, it could be a good idea to take a look at the general market consensus, new plans for the Solana chain and the amount of activity in the DeFi space. 

Is Now a Good Time to buy Solana (SOL)?

While it is nearly impossible to determine if now is a good time to buy Solana, you can use a couple of strategies to limit losses. 

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Dollar cost averaging is a great way to limit losses for long-term investors. This strategy involves buying the same amount of a token at a set interval. For example, yoy could buy two SOL once a month.

Another strategy is setting stop losses. This action automatically triggers a sell order if SOL falls to a certain price. Doing this can take the emotion out of investing and help investors create solid plans for their investments.

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Albania To Start Taxing Crypto-Related Income From 2023

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Albania To Start Taxing Crypto-Related Income From 2023

Authorities in Albania are finalizing regulations that will allow the taxation of income and profits from cryptocurrency investments. The government intends to begin imposing the levy in 2023, after adopting the necessary legislation which has been proposed for public consultations.

Albania Set to Impose Crypto Tax as Early as Next Year

The Albanian state should begin collecting taxes on income from crypto assets as of 2023 in accordance with a new income tax bill, the local English-language portal Exit News reported on Friday. The government also hopes to pass a number of other laws and bylaws this year in order to comprehensively regulate the matter.

The special tax legislation is currently open for public consultations. It introduces the concept of taxing crypto holdings and income derived from virtual assets. The latter have been defined as “a digital representation of a value that can be deposited, traded or transferred in digital form, and that can be used for payment or investment purposes or as a medium of exchange, including but not limited to cryptocurrencies.”

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However, the definition does not cover central bank digital currencies (CBDCs), the report notes. That’s despite a growing number of monetary authorities around the world developing a digital version of their national fiats. The list includes major powers such as the United States, the European Union, China, and the Russian Federation.

The Albanian law also defines cryptocurrency mining as an activity using computing power to confirm transactions and gain virtual assets in exchange. The extraction of cryptocurrencies has been a grey area although law enforcement has been going after illegal mining facilities in the country and pressed charges against some of their operators.

Under the new legislation, any income from crypto transactions or mining will be classified as corporate income when it’s received as a result of business activity. And when the beneficiaries are private individuals, they will have to pay capital gains tax of 15%.

Financial Watchdog Tasked to Expand Crypto Regulatory Framework

Earlier this month, the Albanian parliament ordered the Financial Supervisory Authority (AFSA) to prepare and adopt new regulations regarding cryptocurrencies by the end of 2022. Albanian law allows crypto trading platforms to legally work in the country but no licensed entities are currently operating in Albania, Exit News remarked.

Two years ago, Albania also adopted a law titled “Financial markets based on distributed ledger technology.” While many have welcomed the legislation, critics have questioned whether the small nation in South East Europe, still an EU hopeful, is capable of properly regulating its crypto sector to prevent it from being used for money laundering, something it’s struggling to achieve in the fiat space.

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The legislature referenced a recent report by the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (Moneyval), which recommended additional steps regarding the risks associated with cryptocurrency. In November 2021, the AFSA approved its first two regulations implementing the crypto markets law, which introduced capital and licensing requirements for entities working with digital assets.

Do you expect Albania to adopt comprehensive regulations for its crypto space by the end of the year? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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NHL enters the NFT space partnering with Marketplace Sweet

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NHL enters the NFT space partnering with Marketplace Sweet Abdulrasaq Ariwoola · 42 seconds ago · 1 min read

The NHL partnership with Sweet will offer a variety of digital collectible experiences to its fans, tradable in the marketplace

1 min read

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Updated: June 25, 2022 at 3:59 am

Cover art/illustration via CryptoSlate

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The National Hockey League on Thursday announced its partnership with NFT Marketplace Sweet. This partnership will be the league’s first dive into digital collectibles.

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The partnership, of which the NHL’s players and Alumni’s association are part, will go live in October to mark the start of the 2022-2033 NHL season.

The NHL Marketplace

The NFT marketplace is expected to offer a range of experiences to NHL fans. Including digital collectibles that showcase historical moments, past and present season game highlights, and NHL stars top plays.

The marketplace will also feature gamified collection experiences, specialty packs, and 3D interactive trophy rooms where users can display their collections. Among these offerings there are also dynamic NFTs designed to change based on current team data.

Additionally, fans would be able to buy, sell, collect and trade the collectibles on the marketplace.

However, the announcement did not state which blockchain would host the marketplace.

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NFTs in the sporting space

The NHL  joins a long list of sporting institutions that have embraced digital collectibles.

In 2020, the NBA launched Top Shot NFTs, its digital collectibles marketplace, in partnership with DapperLabs. Likewise, the NFL launched its play and own NFT game while the MLB is to launch its NFT game soon.

However, the extreme sell-off in the crypto market has seen crypto companies pull out of sports deals. This is so as crypto companies strive to stay afloat as the severe sell-off continues in the market.

FTX recently pulled out of a partnership deal with Los Angeles Angels. Similarly, sources suggest a patch deal between NBA Washington Wizards and a crypto company has crashed.

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What Lido staking dominance may mean for Ethereum’s future

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What Lido staking dominance may mean for Ethereum’s future Abdulrasaq Ariwoola · 2 hours ago · 2 min read

The Ethereum community has raised fears of lido staking dominance leading to centralization. What does that mean for ETH 2.0?

2 min read

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Updated: June 25, 2022 at 3:33 am

Cover art/illustration via CryptoSlate

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Lido DAO token holders have commenced voting to determine whether the DeFi platform should reduce its staking pool. The vote is a follow-up to a governance proposal released on June 24.

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The voting process results from a month-long deliberation over Lido’s staking dominance and whether it should limit itself to curb potential centralization risks.

Lido currently holds 31% of all staked Ether on the Ethereum proof-of-stake blockchain, the Beacon chain. The staking dominance has raised fears within the Ethereum community, and critics fear it will threaten Ethereum’s decentralization.

The vote is expected to end on July 1, and the result will determine whether Lido will self-limit or not. Should the majority of voters vote in favor, another vote will take place on how the self-limiting process should work.

Concerns over stETH dominance

In the governance proposal, Lido stated that its staking dominance would give it more voting power once the Beacon chain goes live. As a platform that started to counter centralized exchanges, it argued that such centralized voting power poses an existential threat to the blockchain.

The Ethereum community has raised similar fears about the centralization of voting powers. The DeFi platform currently has around one-third of all staked Ether, which could give voting leverage once the transition to the Beacon chain is complete.

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Vitalik Buterin, the Ethereum co-founder, has argued that no single protocol should have a majority in staking ETH. He opined that such dominance, combined with Lido’s governance structure, is potentially a dangerous point of centralization.

Further, it stated the proposition is premised on the belief that other liquid staking protocols would also limit their exposure. This would effectively allow smaller protocols to meet the supply shortfall.

What Lido staking dominance means for ETH2.0

Ethereum’s transition to a PoS blockchain means it will rely on validators to validate transactions on the blockchain. Unlike a PoW blockchain that requires miners to expend excess energy to solve complex mathematical problems.

However, to operate a validator node, a user must deposit 32 ETH, which is a long shot for many users. Lido, on the other hand, as a staking service provider, allows users to bypass this requirement and earn staking rewards.

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According to data from Etherscan, roughly 12.6 million ETH is staked in the ETH2.0, which amounts to 10.6% of the circulating supply of ETH. Of the 12.6 million ETH staked, approximately 4.2 million have been staked through Lido by 73,369 stakers, making Lido the most used staking pool on Ethereum.

This means, should Ethereum transition to its PoS blockchain with Lido still having the lion’s share of the staking dominance, it would give the DeFi platform excessive influence over transaction verification which many warn could pose a risk. Some concerns include validator slashing, governance attacks, and smart contract exploits.

On the other hand, Lido’s staking dominance could help prevent a takeover by a centralized exchange and ensure the blockchain remains decentralized.

stETH remains depegged

The staked Ether, which is supposed to be pegged to ETH, remains depegged after a wave of massive sell-offs. Speculations have profused about the security of the token and whether its depegging could spell more chaos for the crypto ecosystem.

On June 16, Alameda Capital, one of the largest holders of stETH, dumped its stETH holdings, a massive $57 million. This is coupled with the continued financial troubles of Celsius and Three Arrows Capital, both large holders of stETH.

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As of the time of press, stETH has not gained parity with ETH and is trading at $1,173.

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